After his first full year running comparison site company iSelect, chief executive Brodie Arnhold said the company had “stablilised” in 2018/19, after some difficult times. Stable maybe, but still in the red.
The company reported a loss of $4.4 million for the year to June, compared with a loss of $15.6 million the year before. Excluding discontinued operations, the loss was $2 million.
Revenue fell 12.8 per cent from $176.9 million in 2017/18 to $154.2 million in the year to June. Cashflow from operating activities was down from $8.8 million to $4.7 million.
One troubling metric for the company was that leads generated from the comparison sites fell 6 per cent to 3.9 million.
Arnhold, who has been CEO since April last year, said the company’s strategic review was completed and all actions implemented, including the sale of InfoChoice and the closure of a Cape Town call centre.
In March, iSelect announced a partnership with mortgage aggregator AFG, scrapping its unprofitable home loan operation. The two companies jointly manage the operation with iSelect focusing on “lead delivery” and AFG focusing on “lead fulfilment”.
Arnhold said: “Our goal is to continue to grow in a sustainable and profitable way to the benefit of all our stakeholders. We are continuing to enhance our return on investment through marketing strategy and continuing to invest in our customer experience platform.”
The company’s biggest division is health insurance, with 982,000 leads and revenue of $79.2 million in 2018/19 – both down on the previous year.
Energy and telco had 1.7 million leads and revenue of $43.1 million – also down on the previous year.
Life and general had 1.1 million leads and $24.8 million of revenue. Leads were up but revenue was down.
An ongoing concern for the company is that in April the Australian Competition and Consumer Commission started proceedings in the Federal Court, claiming that iSelect made false or misleading representations in relation to its energy plan comparison service.
The ACCC alleges that since at least November 2016, iSelect has claimed consumers using its website would benefit from iSelect comparing all plans available from its partner retailers in a specific location. During this period, iSelect also claimed that it would recommend the most competitive plan to consumers.
The ACCC alleges iSelect did not compare all available plans and did not necessarily recommend the most competitive plan, but rather limited the number of plans it compared based on the commercial arrangement it had with retailers. It claims iSelect was actually favouring some partner retailers over others and that the preferred retailers paid iSelect higher commissions.